Blackrock big brain, Mr. Fink has it right. He predicts a 15% decline in the ZEuro to 1.20 U$. He is in fact too generous. There is no reason whatsoever for the ZEuro to be worth more than the U$. None. The ZEuro is simply a mask to hide the catastrophic nature of massive Statism, with its attendant cultural Marxism, politically-correct bafflegab and of course, appeasement to Islam and the rendering of Western society. The Euro project is bankrupt in any political-cultural-economic sector one cares to name. Big Banks and Big Government are enmeshed, married, intertwined and inter-dependent. There can be no easy way out. A ZEuro is a far more likely prospect than some mirage currency hanging around parity with the world's reserve currency.

“The fundamental problem is most European sovereign credit is owned by the banking system,” Mr Fink says. “The banking system was supported by the regulators’ credit ratings of sovereign credit, so you could have bought Ireland and it had the same credit rating as Germany at one time . . . that policy was clearly wrong.”

As a result, European banks and insurers are sitting on huge holdings of government debt that have lost value in spite of formerly high ratings. “You have something that was freely understood and traded and people invested in it, to something that nobody wants.”

His comments crystallise the increasingly bearish sentiment – despite Ireland’s decision to seek a multibillion-euro bail-out from its European Union partners and the International Monetary Fund – that is driving investors to dump sovereign bonds issued by nations on the continent’s “periphery” and sell the single currency.”

Mr. Fink who is richer than most ancient Caliphs and Despots, should know about currency values. His firm makes a lot of money trading fiat paper variances. Oddly, even though the US is bankrupt and is now managed by the most openly Marxist regime in its history [a continuation of GW Bush's big Statist policies]; the US$ will actually go up. At least until inflation is unavoidable.

The world's fiat currency system is in obvious trouble, but the Americans do have the world's reserve currency - and this brings them $1 Trillion a year in profits through seigniorage. The Euro is not a reserve currency [30% max for most states] and as such must be the first to suffer in a general EUrinal implosion. The Europeans are simply going to reap what 60 years of Socialism has sowed. A debt inspired economic and social contraction of the most painful variety.

Oustide of the US the Australian and Canadian dollars will do well. Both countries have gold, commodities, minerals you can chew on, preferred trading partnerships and patterns with China and the US, diverse economic assets, reasonably good finances [though still technically bankrupt in the longer term], and a strong financial sector. Europe has few of these advantages.

I would short the ZEuro, go long the U$ and C$, and buy gold. I think a 30% decline is highly likely for the ZEuro. See here for how Marxism murdered the Euro. The ZEuro's death watch will be interesting.